B. NEW ACCOUNTING PRONOUNCEMENTS

In February 2016, the FASB issued ASU No. 2016-02,
Leases (“ASU 2016-02”). The new standard establishes a right-of-use (ROU) model that requires a lessee to record a
ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified
as either finance or operating, with classification affecting the pattern of expense recognition in the statement of operations.
ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years.
A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered
into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients
available. The Company is currently evaluating the impact of its pending adoption of ASU 2016-02 on its consolidated financial
statements. Upon adoption, the Company expects that the ROU asset and lease liability will be recognized in the balance sheets
in amounts that will be material.

In June 2016, the FASB issued ASU No. 2016-13,
Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 provides
guidance for estimating credit losses on certain types of financial instruments, including trade receivables, by introducing an
approach based on expected losses. The expected loss approach will require entities to incorporate considerations of historical
information, current information and reasonable and supportable forecasts. ASU 2016-13 also amends the accounting for credit losses
on available-for-sale debt securities and purchased financial assets with credit deterioration. The guidance is effective for fiscal
years beginning after December 15, 2019, including interim periods within those fiscal years. The guidance requires a modified
retrospective transition method and early adoption is permitted. The Company does not expect the adoption of ASU 2016-13 to have
a material impact on its consolidated financial statements.

Management has evaluated other recently issued
accounting pronouncements and does not believe that any of these pronouncements will have a significant impact on our consolidated
financial statements and related disclosures.

Accounting Standards Recently Adopted

Effective January 1, 2018, the Company has adopted
Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (“ASC 606, the Standard”), which
supersedes nearly all legacy revenue recognition guidance. ASC 606 outlines a comprehensive five-step revenue recognition model
based on the principle that an entity should recognize revenue based on when an it satisfies its performance obligations by transferring
control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in
exchange for said goods or services.

Effective January 1, 2018, the Company has adopted
ASU No. 2016-18, Statement of Cash Flows: Restricted Cash, (“Update 2016-18”). Update 2016-18 provides guidance
on the classification of restricted cash in the statement of cash flows. The amendments are effective for interim and annual periods
beginning after December 15, 2017. The amendments in Update 2016-18 was adopted on a retrospective basis. Due to the adoption of
ASU 2016-18, the cash, cash equivalents and restricted cash presented in the Condensed Consolidated Statement of Cash Flows for
the three months ended March 31, 2018 and 20147 increased by $10,000 and $900,000 of restricted cash held as of March 31, 2018
and 2017, respectively.